The broadband company said Friday it is filing for bankruptcy protection and selling "essentially" all of its broadband Internet access business to AT&T (T: up $0.60 to $19.30, Research, Estimates) for $307 million.

Excite@Home (ATHM: up $0.02 to $0.15, Research, Estimates) said the Chapter 11 filing will enable the company to continue its high-speed Internet access business during the sale.

The sale could change if there are other higher bids, and it requires the approval of the bankruptcy court, among other conditions.

On Tuesday the company laid off 500 workers in an effort to save cash.

In an unrelated move, AT&T on Friday signed a confidentiality agreement with Comcast (CMCSK: up $0.57 to $35.87, Research, Estimates) which will revive negotiations for Comcast's purchase of AT&T Broadband. Attempts to reach Comcast for comment on the Excite sale were unsuccessful.